Singapore Investors’ enthusiasm for Asian stocks is waning as a raft of political and economic risks takes the shine off the best first-quarter returns in 26 years.

That period of strong gains could put Asian equities in the firing line for a sell-off as funds investing in the region play it a lot safer than they were a few months ago on concerns that economic and business cycles may have peaked.

Most of the positive news may be priced in already. But at the same time, if we are seeing disappointments, this could be a trigger for more profit-taking, said Tuan Huynh, Asia Pacific chief investment officer at Deutsche Bank Wealth Management, who now recommends an underweight exposure to Asian equities from overweight at the start of 2017.

Earnings season in the US and political events like elections in Europe may bring negative surprises that could lead to corrections, he said.The MSCI Asia ex-Japan index returned 12.8% in the first three months of 2017, the best first-quarter performance since 1991 as almost US$17bil of funds flowed into the region, excluding China and Malaysia.

But they’ve returned a pittance since then and flows slowed to only US$563mil in April through the 19th, according to Thomson Reuters data, as risks grew, including nuclear threats from North Korea, a series of elections in Europe and delays in fiscal stimulus and protectionist rhetoric from the US.

Business activity in Asia, which had been above trend and improving in the second half of 2016 and earlier this year, is now above trend but decelerating, Goldman Sachs’ chief Asia Pacific Equity strategist Timothy Moe said in a podcast this month.

Over the last 15 years, average three-month returns in a period of above-trend improving activity have been 7.9% for the MSCI Asia Pacific ex-Japan index, while returns have fallen to 1.5% in above-trend decelerating phases.

We’re going through a period of really juicy, good returns to a period where returns will be positive but decidedly more muted in magnitude, he said.The modest acceleration in global expansion and inflation expected in 2017 and 2018 is also not enough to return trade growth to pre-global financial crisis levels, according to Schroders.

Cyclical upswings in China and the United States, which have helped trade, are likely to fade soon, Keith Wade, chief economist and strategist at the investment house, wrote in a note this month.

Without the support of these two economies, global trade is likely to roll over (slow), at least in value terms, in the second half of 2017, he added. The implication is that this will take emerging market equities with it.

Still, investors aren’t bailing out of Asia entirely, even though stocks are the most expensive relative to other emerging markets since February 2015. That is because they are still cheaper than developed markets, and earnings growth is finally materializing after years of disappointments.

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